US-Listed Chinese Stocks Give Up Gains In Anticipation Of More Stimulus

On Thursday, Alibaba Group Holding. (NYSE: BABA), also known as China’s tech barometer, traded upwards as China kicked off its annual economic work conference on Wednesday to outline its policies and growth targets for 2025. 

The two-day Central Economic Work Conference was expected to run through Thursday. Investors are watching for additional stimulus measures.

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The market expects more stimulus measures to counter possible tariffs launched by President-elect Donald Trump, as he promised during his campaigns.

Other U.S.-listed Chinese stocks, including JD.com, Inc. (NASDAQ: JD), Baidu, Inc. (NASDAQ: BIDU), NIO Inc. (NYSE: NIO), Li Auto Inc. (NASDAQ: LI), and XPeng Inc. (NYSE: XPEV) also saw positive movement in their share price trajectory in the premarket session.

However, according to a report, Chinese leaders on Thursday assured of taking a proactive approach to boosting the economy but provided no details.

Post-meeting, lack of details on definitive measures led to a negative reaction from investors, leading to a fall in U.S.-listed Chinese stocks, which gave up all the premarket gains.

On Monday, President Xi Jinping’s Politburo pledged aggressive fiscal measures and a relatively more flexible monetary policy in 2025 to boost domestic consumption.

Tao Wang of UBS Group AG told Bloomberg that he expects China to boost policy support in the next two years, including more supportive policy tones for 2025.

China’s stimulus so far has focused on producers and infrastructure, especially electric vehicles, solar energy, and batteries.

Economists expect China to set a higher-than-usual budget deficit target of up to 4% of GDP.

According to Bloomberg, Xi expressed confidence in the world’s second-largest economy in several meetings over the past week. 

Larry Hu of Macquarie told Reuters that China’s initiatives for 2025 will depend on its GDP target and the new U.S. tariffs. He does not expect China to announce 2025 growth, budget deficit, or other targets.

Investors can gain exposure to Chinese equities through Invesco Golden Dragon China ETF PGJ, ProShares Online Retail ETF ONLN, and iShares China Large-Cap ETF FXI.

Price Actions: At the last check on Thursday, BABA stock is up 0.09% to $89.06. JD is down 1.60%, BIDU is down 0.85%, NIO is down 0.64%, LI is down 0.36%, and XPEV is down 0.39%.

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